KBRA Withdraws One Rating, Downgrades Five Ratings, and Affirms All Other Ratings for CGCMT 2016-P6
6 Nov 2026 | New York
KBRA withdraws its AAA (sf) rating on Class A-4 following the reduction of the principal balance of the rated security to zero as reflected in the October 2026 remittance report. Additionally, KBRA downgrades the ratings of five classes of certificates and affirms all other outstanding ratings for CGCMT 2016-P6, a CMBS conduit transaction. The transaction has been reduced to 21 assets with an aggregate balance of $480.4 million, from 54 loans totaling $913.4 million at securitization. The rating actions are based on our identification of 10 K-LOCs (64.1% of the pool balance), KBRA's estimated losses of $82.7 million (which, if realized, would impact the class D certificates and below) and corresponding recoveries; realized losses totaling $5.6 million, which were allocated to the class H certificates; and cumulative interest shortfalls of $6.0 million affecting the class E certificates and below. If realized, estimated losses would reduce the principal balance of classes E, F, G, and H to zero and reduce the principal balance of the class D certificates by 18.6%.
Additionally, all of the remaining assets are scheduled to mature by January 2027. Based on the most recent servicer-reported NCF and a refinance of the current balance with an assumed IO loan at a rate of 6.50% to 7.50%, depending on property type, there are 13 loans ($189.2 million; 39.4%) that would have DSCs above 1.20x.
As of the October 2026 remittance period, there are six specially serviced assets (46.8%), of which two (15.2%) are REO, one (7.3%) is 30+ days delinquent, and two (8.7%) are matured non-performing. KBRA identified 10 K-LOCs (64.1%), including the specially serviced assets. Of the K-LOCs, five (42.9%) have estimated losses. The details of the K-LOCs are outlined below.
8 Times Square & 1460 Broadway ($75.0 million, 15.6%, Specially Serviced)
- The loan is collateralized by a 16-story, 214,341 sf, office building with ground floor retail located on the corner of West 41st Street and Broadway in the Times Square South neighborhood of New York City's Manhattan borough. The building has 36,120 sf of retail space from the third floor to the basement, 178,221 sf of office space on floors four through 17, and four digital LED signs, three of which are leased by the sole retail tenant, Foot Locker. The office tenant is WeWork (34.3% total base rent, 83.1% total sf). The loan is scheduled to mature in November 2026.
- The loan transferred to the special servicer in August 2026 for imminent maturity default. The borrower has yet to submit a request for modification or maturity extension. KBRA views the WeWork exposure as a meaningful credit risk given the tenant’s recent history and considering the age and quality of the building and the challenges the borrower would face re-leasing any space that becomes vacant. WeWork renegotiated its lease following its bankruptcy filing, resulting in a 20.0% rent reduction. Its lease expires in August 2034.
- The servicer reported an occupancy and DSC of 100% and 1.92x as of YTD June 2026. KBRA's analysis results in an estimated loss of $72.0 million (36.0% loss severity) on the whole loan balance of $200.0 million, of which $27.0 million is allocated to this trust. The estimated loss is based on a KBRA liquidation value of $128.3 million ($598 per sf). The liquidation value is derived from a direct capitalization approach using a KNCF of $9.9 million and a capitalization rate of 7.70%.
681 Fifth Avenue ($57.5 million, 12.0%, Specially Serviced, REO)
- The REO asset is an 82,573 sf, mixed-use retail/office building located in the Midtown section of New York City’s Manhattan borough. The development consists of a 17-story building with two below-grade levels. The building features 22,510 sf (27.3%) of retail space on the basement levels through the fourth floor and 60,063 sf (72.7%) of office space.
- Tommy Hilfiger previously leased the property's retail space but vacated in April 2019. The retailer continued to pay its contractual rent through lease expiration in May 2023, accounting for approximately 80.0% of the property's total base rent at that time. The loan was transferred to the special servicer in September 2023 due to payment default and the special servicer began pursuing foreclosure in December 2023. A receiver was appointed in February 2024. A foreclosure sale took place in March 2026, and the lender took the title of the asset. The receiver continues to market the vacant space, and a sale of the asset is projected to occur by YE 2026; however, the sale may be reevaluated if a buyer does not materialize.
- The servicer reported an occupancy and DSC of 66.0% and 0.16x for the YTD March 2026. An updated appraisal dated July 2026 valued the asset at $120.0 million ($1,453 per sf), which represents a 72.7% decline from the $440.0 million ($5,329 per sf) value at issuance. The asset carries an aggregate ARA of $135.6 million on the whole loan balance, with $38.9 million attributable to this transaction resulting in a cumulative ASER of $1.3 million for the subject transaction.
- KBRA’s analysis resulted in an estimated loss of $148.6 million (69.1% estimated loss severity) on the whole loan balance of $215.0 million. The estimated loss is based on a KBRA liquidation value of $89.2 million ($1,080 per sf) and total projected exposure of $237.8 million. The liquidation value considers a distressed non-stabilized disposition of the asset as well as comparable market values.
Fresno Fashion Fair ($35.0 million, 7.3%, Specially Serviced, 30+ Days Delinquent)
- The loan is collateralized by a combination of an enclosed single-story, open-air, super-regional mall located in Fresno, California. Built in 1970, Fresno Fashion Fair Mall contains 957,944 sf of retail space, of which 536,093 sf serves as collateral for the loan.
- The loan transferred to special servicing in July 2026 due to imminent maturity default. The special servicer had been negotiating forbearance terms with the borrower's representative and the loan’s sponsor, The Macerich Partnership, L.P., an affiliate of The Macerich Company (NYSE: MAC), ahead of scheduled maturity on November 1, 2026.
- The servicer reported an occupancy and DSC of 94.0% and 2.07x for the YTD March 2026. At this time, KBRA does not estimate a loss on this asset, which has a whole loan balance of $325.0 million.
Hyatt Regency Jersey City ($35.0 million, 7.3%, Specially Serviced, Matured Non-Performing)
- The loan is collateralized by a nine-story, 351-key, full-service hotel located in Jersey City, New Jersey, one mile west of Manhattan. The hotel is well served by highways and public transportation, including Interstate 78, the Hudson Bergen Light Rail, and the Exchange Place PATH Station, all of which are less than one mile from the property.
- The hotel has continued to underperform its historical averages due to a decline in occupancy and an increase in operating expenses since issuance. According to the TTM ended July 2025 STR report, the subject is underperforming its competitive set, as evidenced by its RevPAR penetration rate of 86.5%, compared to 95.1% at last review and 116.7% at issuance. A major renovation project was completed in Q1 2025 and servicer commentary indicated the full inventory of rooms was not available during the renovation phase. The borrower, which acquired the asset in 2022, has indicated it will be unable to repay the loan at maturity. The borrower and lender are in discussions regarding a potential forbearance agreement.
- The servicer reported average occupancy of 79.0% and a DSC of 1.14x for FY 2025. As of October 2026, the asset is matured non-performing with the special servicer. KBRA estimates that the loan could experience an estimated loss of $21.3 million (21.3% estimated loss severity) on the whole loan balance of $100.0 million, of which $7.4 million of the estimated loss is allocated to this trust. The estimated loss is based on a KBRA liquidation value of $82.3 million ($234,473 per key) and projected total exposure of $103.6 million. The liquidation value considers a distressed non-stabilized disposition of the asset.
925 La Brea Avenue ($26.8 million, 5.6%)
- The loan is collateralized by a 63,331 sf office building with ground floor retail space located in West Hollywood, California, approximately seven miles northwest of the Los Angeles CBD.
- The loan remains on the servicer's watchlist due to a decline in DSC; the low DSC was caused by rent abatements and lower parking income compared to prior years. Occupancy was previously expected to improve to 95.8%; however, the largest tenant only occupies half the space reported at last review. The borrower failed to repay the loan by its October 2026 maturity date. The borrower has reported it is working on a short term extension.
- The servicer reported an occupancy and DSC of 71.0% and 0.64x for the YTD June 2026. At this time, KBRA does not estimate a loss on this asset.
Georgetown Plaza ($23.0 million, 4.8%)
- The loan is collateralized by a 150,589-sf, mixed-use office/retail building located in the Glover Park neighborhood of Washington, DC.
- The subject has reported weak operating performance, which comes as a result of higher operating expenses than were expected at closing, paired with declining base revenues due to free rent periods for multiple tenants.
- The servicer reported an occupancy and DSC of 84.0% and 0.44x for the YTD June 2026. The loan is scheduled to mature on November 10, 2026. As of the October 2026 remittance period, the loan is current in payment and not specially serviced. However, in the event of a default, KBRA estimates the loan could experience a loss given default of $5.0 million (21.8% estimated loss severity) on the whole loan balance of $23.0 million. The estimated loss is based on a KBRA liquidation value of $18.9 million ($127 per sf). The liquidation value is derived from a direct capitalization approach using a KNCF of $1.6 million and a capitalization rate of 8.50%.
Arbor Ridge Office ($15.5 million, 3.2%, Specially Serviced, REO)
- The REO asset is collateralized by a 128,627 sf suburban office property located in Malvern, Pennsylvania, approximately 28 miles northwest of the Philadelphia CBD.
- The loan was transferred to the special servicer prior to its November 2023 maturity default. The special servicer began pursuing foreclosure in January 2024 and a receiver was appointed in June 2024. In September 2026, the lender took title to the asset following a foreclosure sale. The special servicer reports leasing efforts to stabilize the asset will continue.
- The servicer reported an occupancy and DSC of 76.0% and 1.32x for the FY 2025. An updated appraisal dated July 2025 valued the asset at $13.5 million ($105 per sf), which represents a 45.3% decline from the $24.6 million ($191 per sf) value at issuance.
- KBRA’s analysis resulted in an estimated loss of $6.0 million (39.0% estimated loss severity) on the whole loan balance of $15.5 million. The estimated loss is based on a KBRA liquidation value of $11.8 million ($92 per sf). The liquidation value considers a distressed non-stabilized disposition of the asset.
The three remaining K-LOCs account for 8.3% of the pool balance and do not have estimated losses:
- Boynton Trail Centre ($22.4 million, 4.7%) is a 232,402 sf, grocery-anchored retail center located in Boynton Beach, Florida, approximately 60 miles north of the Miami CBD. The property is anchored by a Walmart Neighborhood Market. Despite an increase in occupancy to 98.0%, the servicer reported debt yield remains low at 8.4%, and the DSC is near breakeven at 1.17x with a 4.39% interest rate. The current loan metrics indicate moderate to high refinance risk. At this time, KBRA does not estimate a loss on this asset.
- Villanueva Portfolio ($10.7 million, 2.2%) is comprised of four properties totaling 88,778 sf across Pennsylvania and Texas. The collateral includes the 28,532-sf Waynesboro Shopping Center in Waynesboro, Pennsylvania, the 22,000-sf Kuykendahl Medical Office in Spring, Texas, the 22,240-sf University Medical Plaza in Sugar Land, Texas, and the 16,006-sf Wortham Village Shopping Center in Houston, Texas. Despite occupancy levels near or above 80% at each asset, the servicer reported a near breakeven DSC of 1.02x as of YTD June 2026 with an interest rate of 4.76%, and a debt yield of 7.80%. The current loan metrics indicate high refinance risk. At this time, KBRA does not estimate a loss on this asset.
- 1120 Executive Plaza ($6.5 million, 1.4%, Specially Serviced, Matured Non-Performing) is a 95,485 sf suburban office property in Mount Laurel, New Jersey, about 15 miles east of downtown Philadelphia, Pennsylvania. The asset transferred to the special servicer in September 2026 for imminent maturity default, as the borrower failed to repay the loan by its September maturity date. The special servicer is reviewing the loan file to determine a workout strategy. At this time, KBRA does not estimate a loss on this asset.
Details concerning the class with a rating withdraw:
- Class A-4 to WR from AAA (sf)
Details concerning the classes with rating changes are as follows:
- Class C to BBB- (sf) from BBB (sf)
- Class D to CCC (sf) from B (sf)
- Class E to CC (sf) from CCC (sf)
- Class F to C (sf) from CC (sf)
- Class X-D to CCC (sf) from B (sf)
Details concerning the ratings affirmations are as follows:
- Class A-5 at AAA (sf)
- Class A-S at AAA (sf)
- Class B at AA- (sf)
- Class G at C (sf)
- Class X-A at AAA (sf)
- Class X-B at AAA (sf)
Rating Sensitivities
Future rating actions will be dependent upon the ongoing assessment of the timing and likelihood of ultimate payment of principal and accrued interest on the rated certificates. The assessment will consider the expected and actual losses on the remaining assets in the transaction, as well as the magnitude and extent of interest shortfalls, if any, on the certificates.
To access ratings and relevant documents, click here.